Future Finance
Jack Ma’s Ant Hit by Flurry of New Rules Ahead of Mega IPO
- Watchdog caps leverage of China’s small loan companies
- Funds from ABS, debt leverage capped at 4 times of assets
This article is for subscribers only.
Ant Group was dealt another blow by more regulations to contain risks in the country’s burgeoning online lending industry as Jack Ma’s financial technology giant prepares for its initial public offering.
China’s banking watchdog on Wednesday issued fresh rules to cap the use of asset-backed securities to fund quick consumer loans, which will force Ant in particular to rein in that part of its business. The new regulation limits that sort of funding to four times a firm’s net assets, while Ant currently has 4.7 times such debt against its capital.